Update: New mobo, CPU and RAM
I had an extra computer I slapped together a while ago and used as an old Win98 machine. I figured for this project, the PC would suffice until I decided whether it was worth investing in a more powerful unit. At the time, the PC had performed admirably and for the games we played, much more power wasn't really necessary. Of course, over time, I wanted to play more games with fewer glitches, so the upgrades were inevitable. Here's the configuration of the PC now:
I have the PC case sides open, no need to keep them on, so the PC stays cooler in the cabinet. The fan airflow should be sufficient to keep things humming. I can feel the cabinet does get a little warm inside, but not hot.
I also have an 80mm Panaflo fan blowing in over the coin door and an 80mm Panaflo fan blowing out on the top of the cabinet - think out your cooling scheme. I also looked hard for "silent" fans. This should keep the air flowing well and keep the cabinet cool enough. Also, make sure you can replace the fans easily. They sometimes start to make noise over time. You can also buy a 12V to 7V power reducer to minimize fan noise, but I didn't do this.
I got the wireless desktop solution so I could put the keyboard and mouse wherever I wanted without having to build a drawer in the cabinet. I just leave them on top with the TV remote and no one notices them. The matching yellow actually looks like they were made for the cabinet. They can be brought down in an instant. I put the transmitter inside the control panel to minimize transmission interference (which actually is a problem when placed inside the cabinet). The wires just run outside the back of the control panel and down into the cabinet in the back of the PC and go into the PS/2 and USB ports.
The Wireless NIC was nice until I ran a hardwire ethernet port right behind the cabinet. It's a much faster connection now which is good for backing up the PC. I left the wireless NIC inside, but have just disabled it. I also leave the hardwire NIC disabled unless it's needed. If everything works, is self-contained and has no detected viruses, there should be no need to update any software. I do it anyway on occasion just as a precaution.